Costs

Costs may be classified as manufacturing costs and non-manufacturing costs. This classification is usually used by manufacturing companies. Manufacturing costs: Manufacturing costs can be further…

Differential cost is the difference between the cost of two alternative decisions, or of a change in output levels.  The concept is used when there…

A committed cost is an investment that a business entity has already made and cannot recover by any means, as well as obligations already made…

Manufacturing cost accounting encompasses several tasks that impact production operations and the valuation of inventory. These activities can significantly boost the profits of a business,…

A job costing system involves the process of accumulating information about the costs associated with a specific production or service job. This information may be…

Total cost is defined in three ways, depending on whether you are engaged in cost accounting, investments, or capital budgeting. In general, it is the…

Cost benefit analysis involves the weighing of the costs associated with a decision against the benefits arising from that decision. The analysis is used to…

The difference between fixed and variable costs is that fixed costs do not change with activity volumes, while variable costs are closely linked to activity…

Cost classification involves the separation of a group of expenses into different categories. A classification system is used to bring to management’s attention certain costs…

The key difference between product costs and period costs is that products costs are only incurred if products are acquired or produced, and period costs…